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Liquidity in the racing markets has dive bombed lately. Thought it was the summer holidays but September is worse. 3 million matched pre-off in the Yorkshire Oaks last year, 1.9 million this time around. Keep thinking my browser is stuck, but it isn’t.
The recreational players are leaving the building…..
It appears to be the case. What ever you might think of him, Dave Nevison touched on this in his first book.
"The margins are so small that there is a danger that Betfair will eventually run out of layers"
The Yorkshire Oaks is an unfair comparison as Sariska was a long odds on fav in 2009.
You’re right though, business is way down, especially since August and especially the early markets.
Sariska provides a good illustration. The markets on the Vermaille contained a dozen matchsticks, three or four milk bottle tops and a bubble gum wrapper right up to the point where they started loading up. Then one meaningful bet was offered up – evens on Sariska to place. It was the only liquidity on the screen!
Detective Gamble and myself are off to where it all kicked off tonight to look for clues on where it all went wrong.
Ok, fair enough, to use 1 race is not a fair comparison, although a 30% drop in liquidity for such a prestigious race would not be expected even allowing for a long odds on fav last year.
Gimcrack Day 2009 – 8964218 (6 races)
Gimcrack Day 2009 – 6902555 (6 races)Almost a 30% drop in pre-off win market amounts matched.
Is there evidence that the slack is being taken up by post-off (in running) and Betfair SP markets?
Not sure how much information is available for those, but the latter in particular must have grown in the last 12 months.
Besides anything, it does not follow that a drop in pre-race turnover is down to a shortage of layers. It could be down to a shortage of backers. Or, rather, that not so many backers are betting into the pre-race markets. Ultimately, though, the two end up working in tandem.
By way of comparison, I used to lay books with early prices the night before. I gave up because the amount of money being matched pre-10 am plummeted as people wised up to the virtue in being more patient. There was no shortage of layers (or at least was not to begin with).
Meanwhile, the amount of money matched on Betfair AT ALL TIMES continued to escalate.
A very simplistic analysis, but it tells the story pretty well.
I’ve only got data loaded up to late July. Results of linear regression, with the day number as the only independent variable (Jan 1st =1, Jan 2nd =2 etc) and pre-off takeout as the dependent variable (ie the sum of price*volume for the horse), equation basically reads:
Horse’s takeout = 600,000 – (1000*day number)
Using the Gimcrack data again…
Inrunning 2009 6 races…1168319 matched
Inrunning 2010 6 races…1172838 matchedHardly any change, not surprising considering its been a no go for any sane recreational punter for years now.
I used BFSP quite a bit and no noticeable change there either.
I have the price data, Pru, its the layers willing to lay at value prices that have gone missing. ie. the punters who dont know what their doing, preyed upon those that do.
The recreational punters have done their money and or have gone elsewhere.
If they really are planning to float then they surely have to think about seeding some of these markets lest a prospective investor takes a peek at the current reality.
Go there now, have a look at today’s racing:
Maybe a third or a quarter of the boxes on the right hand side are blank. Many horses don’t have a single offer at any price. We’re not take about D Nolan no hopers either.
If you cleaned the screens on your selection down to 1.01 on many of these races (coupled with laying the field for everything up there) you’d get a couple of grand if it won.
The 4.40 at Redcar (a maiden where every horse has run at least once) has no offers on half the field. if you laid everything at 1000, taking out every offer on the right hand side, you’d have less than a monkey in your hod.
I’m just one example of a BF user that has ceased to be a layer during the flat season. In my case, it’s nothing to do with the margins or the liquidity, simply a lack of enthusiasm for the vast majority of the racing being served up.
My laying might have amounted to twenty to thirty thousand in liabilities per week through the summer, so it’s just a pinprick, but if there were fifty or a hundred like me, it mounts up.
AP
Have punters gone back to bookmakers?
I often find bookmakers early prices equal or better than betfair at that time of day these days (picking the best price in the village). And with best odds guaranteed it makes sense for smaller gamblers to go that way.Value Is EverythingInteresting stuff , could it be that a lot of players have just got fed up of the flat for whatever reason and just back off until the Jumpers are back in full swing
It will be good to see if the figures perk up from November to April
The flat is a load of boring rubbish nowadays
Ricky
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